Despite 82% revenue increase in 2024, decrepit facilities worry FAAN MD
- Budget limitation hinders agency from implementing key projects
The Federal Airports Authority of Nigeria (FAAN) has improved its revenue generation by over 100 per cent as the Managing Director of the agency, (FAAN), Olubunmi Kuku disclosed that the sum of ₦343,870,721,789.31 was generated from January to November, 2024 indicating an increase in revenue 82.5% performance which represent a positive variance of ₦155,487,786,012.29 between 2024 and 2023.
The disclosure by Kuku is a cheery one considering how meager revenue it was supposed to generate from mostly non aeronautical sources and at a time the bulk of revenue comes from Lagos, Abuja, Port-Harcourt airports.
Immediately after Kuku assume position as FAAN MD, she swung into action to block revenue leakages and cut so much waste that had dogged the agency years before now.
Document made available to Aviation Metric at the weekend during the stakeholders meeting called at the instances of the Minister of Aviation and Aerospace Development, Mr. Festus Keyamo to brainstorm in Lagos on issues affecting the sector and the performance level of the various aviation agencies shows that the planned concession of some of the country’s airports could free government of massive investment in the aerodromes while equally making huge returns on them as capital expenditure would be transferred to the private sector.
One of the first thing she did on assumption of office was to review and re-pricing of aeronautic and non-aeronautic tariffs at the airports to reflect economic realities, optimisation of revenue generation, re-evaluation of concessions, review and recalibrate the pricing structure based on current market realities and explore options for flexible pricing arrangements that would consider the agency’s operational costs.
Others are completion and test running of the multi-level Car Park at the Nnamdi Azikiwe International Airport, Abuja for use, review of work process for seamless processing and eradication of bottlenecks in work process for improved turn around time/fast track/one-stop shop and the commissioning of prepaid meters to all concessionaires , government agencies and armed forces to block leakages.
She described FAAN as a national asset designed to operate airport infrastructure and equipment, as well as a tool for economic development.
Aside from the increased revenue generation and the determination to reposition it, Kuku explained that FAAN faces several challenges that impact its efficiency and operational capacity.
She listed some of these challenges to include aging infrastructure, security challenges and land encroachment.
She said, “Many of FAAN’s facilities, including terminals and runways, are aging and in need of significant repairs and upgrades. This affects operational efficiency and safety, and necessitates substantial investment for modernisation. Despite efforts to enhance security at airports, FAAN continues to face challenges in managing security risks, particularly with the increase in air travel and the potential for terrorist activities or other threats at key airport locations. Due to lack of perimeter fence, the Authority landmass is constantly being encroached on all over the country”.
“There is CCTV inadequacy, inadequate staff training quarterly with the requisite skills, and knowledge to maintain equipment and also cope with modern technologies. Obsolete equipment such as old fire tenders, generators, air conditioning systems conveyor lines with worn-out slats, belts and motors, can be found in many airports that have low efficiency and have high maintenance cost.”
She equally lamented that FAAN struggles with a shortage of staff across various directorates which impacts its ability to effectively manage operations, maintenance, and customer service, hinting that the under- resourcing of critical roles hinders the agency’s ability to meet the growing needs of the aviation industry.
She explained that FAAN often faces budgetary limitations that hinder its ability to implement key development projects, including the necessary upgrades to airport facilities and infrastructure.
Kuku called for sustained investment in both human and physical capital saying they are critical to the continued growth and modernization of Nigeria’s airports, adding that FAAN will prioritize enhancing passenger experience by implementing advanced technologies, improving customer service training for staff, and ensuring seamless operations across all airports.
“Special attention will be given to reducing processing times, upgrading lounges, and introducing more user-friendly facilities for passengers and stakeholders. FAAN also aims to transition from manual processes to full digitalization in its operations, improving efficiency and service delivery.”
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